Forum Debated in UC-USC Alzheimer Grant Fight

(CN) – The Ninth Circuit on Monday heard a spat between the University of California and the University of Southern California over Alzheimer’s research data to decide whether the case belongs in federal or state court.

The UC Regents sued USC in 2015 after one of their researchers, Paul Aisen, left the University of California, San Diego, along with eight of his colleagues to establish a new institute at USC to study the neurological disease.

At stake is $100 million in grant funding that was used to run the Alzheimer’s Disease Cooperative Study at UCSD.

At issue at Monday’s Ninth Circuit hearing before Circuit Judges Morgan Christen and Ferdinand Fernandez and U.S. District Judge Consuelo Marshall from the Central District of California is whether U.S. District Judge Roger Benitez erred in remanding the case to state court where the UC Regents had originally filed the case.

Quinn Emanuel attorney Susan Estrich, representing USC and Aisen, told the panel the issue central to the case involves ownership over data complied on computers used when Aisen and the others worked at UCSD. The computers contain information from clinical drug trials involving thousands of patients.

“It is clear that the materials we’re dealing with here are works protected by federal copyright law,” Estrich said.

Estrich said in its original complaint, UC San Diego argued the facts compiled by Aisen and the other researchers “belongs to them,” an ownership issue under the Copyright Act’s work-for-hire doctrine which should be overseen by a federal judge and not a state judge.

Only after the case was remanded to federal court did UC San Diego abandon its legal theories based on the Copyright Act, Estrich said.

The hearing was peppered by questions from Christen, who suggested to Estrich the issue of whether the UC Regents are raising a copyright claim “isn’t your problem” and that it would be up to the regents to prove they are not raising a federal claim.

UC Regents attorney Daniel Sharp with Crowell & Moring said the first order remanding the case to federal court was an “error.”

“If our complaint had been filed in federal court it would have been subject to dismissal because it does not allege a federal complaint,” Sharp said.

But Judge Marshall said the regents’ complaint “raised the issue of ownership” which “kind of indicated you were considering a federal claim.”

Sharp responded: “Just because we say they don’t have a leg to stand on in federal law doesn’t mean we’re basing our six state-law claims on federal law.”

Christen indicated she thinks “this is a very close case. It’s not a neat fit.”